Tuesday, December 9, 2014

Greece’s stock market just suffered its worst collapse ever

Published: Dec 9, 2014 11:50 a.m. ET
Political jitters in Greece could delay ECB QE program


LONDON (MarketWatch) — Now this is Greek tragedy.

Greece’s Athex Composite GD, -12.78% tanked almost 13% Tuesday — the biggest drop for the index on record, according to FactSet. The renewed jitters came after the government, in a surprise move late Monday, said it would bring forward presidential elections to Dec. 17, potentially, setting the scene for snap elections in early 2015.

Here’s why that’s important: Far-left party Syriza currently is leading the early polls and it seems likely they would win a snap election. This is how to think about Syriza:
The party has been calling for an end to austerity in Greece
Has been campaigning for market-unfriendly measures
Is firmly against the international bailout program that helped the country avoid a default during the depths of its financial crisis.

How bad is Greece’s Tuesday collapse? It’s worse than the 9.7% drop the market saw Oct. 24, 2010, at the peak of Greek debt worries. The drop also eclipses the 10% fall Greek markets saw in 1989 during a bout of political turmoil.